Maxim manufactures a hamster food product called Green Health. Maxim currently has 20,000...
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Maxim manufactures a hamster food product called Green Health. Maxim currently has 20,000 bags of Green Health on hand. The variable production costs per bag are $3.60 and total fixed costs are $28,000. The hamster food can be sold as it is for $10.00 per bag or be processed further into Premium Green and Green Deluxe at an additional cost. The additional processing will yield 20,000 bags of Premium Green and 4,800 bags of Green Deluxe, which can be sold for $9 and $7 per bag, respectively. The incremental revenue of processing Green Health further into Premium Green and Green Deluxe would be: Multiple Choice 0 $209,600. 0 $13,600. 0 $9,600. 0 $4,000. 0 $213,600. Walters manufactures a specialty food product that can currently be sold for $21.10 per unit and has 19,100 units on hand. Alternatively, it can be further processed at a cost of $11,100 and converted into 11,100 units of Deluxe and 5,100 units of Super. The selling price of Deluxe and Super are $31.90 and $19.10, respectively. The incremental net income of processing further would be: Multiple Choice $37,390. $48,490 $17,100. $43,100. $11,100
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